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How to prepare an Employee Handbook?

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What is an Employee Handbook?

An Employee Handbook provides guidance and information on a company’s mission, vision, policies, behaviours, set of rules and regulations, code of conduct, and asset management and contains all the information that the employee must know and follow. It is designed to ensure that employees are aware of company policies and laws, as well as other exclusive policies like the employee code of conduct policy, social media policy, employee privacy policy, etc.

Employee Handbook


The Handbook is also helpful in avoiding any kind of conflict that might arise in the future between the employee and the employer. Every company has a handbook that every employee has to sign to be a part of that organization, and we can say that it is a one-sided agreement from the employer’s side containing a set of rules and regulations that every employee has to follow. The Handbook is only applicable to the employees that are part of the organization. It should always be written in simple language so that everyone can easily understand and follow it. It also reduces confusion or disciplinary actions later on and is one of the easiest ways to welcome new employees and share information about the company’s mission, vision, policies, etc.

The Employee Handbook covers all the aspects of employment: Recruitment and Selection; Conditions and Benefits; Training and Promotion; Task Allocation; Shifts and Hours; Leave arrangements; Workload; Equipment; and Transport. On-site, Off-site, or After-hours work; work-related social functions; conferences—wherever and whenever staff may be as a result of their duties. The companies may update, remove, or replace these policies at any time. An employer should always make policies by keeping in mind the feedback from the employees.

Before creating the employee handbook, the following points should be noted about the organization:

  • Know your company’s history and culture: Before creating an employee handbook, management should always consider the company’s history and culture, as well as the information and details about the company that is most important for employees to know in order to avoid compliance issues.
  • The employer must know the policies that are not needed to be excluded: This is as important as the policies that are to be included. The employer also must know what policies are not to be included in the handbook to avoid certain clashes with the employees.
  • Set the tone: The employee handbook generally starts with the company’s introduction, which includes the company’s mission, vision, and culture. The employees should also be informed about the importance of the handbook so that they read and follow the rules and regulations.
  • Create an acknowledgement form: Once the employee handbook is created, the employer should not forget to create a proper acknowledgement form that says that the signing employee is responsible for reading, understanding, and complying with the employee handbook.

What to include in an Employee Handbook?

  • Employee Code of Conduct: The Code of Conduct document outlines the appropriate behaviour that the employer expects his employees to show towards their colleagues and seniors in the workplace. As per this policy, each employee is expected to create a well-organized, respectful, and collaborative environment.
  • Leave Policy: The leave policy is the document that tells the employees about the various types of leave that they can avail of during a given month or year. This policy document highlights the number of Casual Leaves, Sick Leaves, Earned Leaves, Birthday or Anniversary leaves, Paternity Leaves, and Maternity Leaves that they will be getting in a month or a year and all the guidelines that are to be followed to apply for leaves.
  • Referral Bonus Policy: This policy is used to inform employees about the open positions/job openings in the organization and the amount they can earn as a referral bonus if they refer new talent to the company and get selected. Some companies pay employees or firms simply to refer candidates to the company for the required role or position.
  • Medical Policy: It is a type of policy that is used by the company to inform the employees about the medical benefits they are providing to the working professionals of the organization facing illness, accidents, or any other health issues. Companies provide their employees with health insurance and other medical benefits to cover their medical related expenses to a certain extent.
  • Appraisal Policy: This policy tells the employees about the increment process that occurs in an organization after a specific time period, this policy has various parameters that are needed to be achieved and met in order to be eligible for it, and a sufficient amount of time should be taken to evaluate the employee’s performance for appraisal. Also, proper discussions should be conducted with the employee and the team leader or manager regarding performance and appraisals. It is a good policy as the employees get to know about the appraisal and their growth path in the company.
  • Remote work policy: This policy tells the employee about the availability of the work-from-home option available in difficult times and this policy has a set of rules that are needed to be followed in order to work remotely.
  • Social Media Policy: A social media policy is a policy that guides the employee as to whether they can post any company-related stuff on the internet or not and, if they can, what protocols are to be followed. However, most companies do not allow you to post anything on social media that is a part of the company, such as company images or information related to the products, and even some companies have a policy that does not allow their employees to search any individual or their colleagues using the company’s name. Some companies allow their employees to post pictures on social media, but they do not allow them to share any information or credentials that could be harmful to the company, or which violate the organization’s confidentiality.
  • Anti-Discrimination, Anti-Harassment and Non-Violence Policy: This policy states that any kind of discrimination, harassment, or violence that creates an unpleasant environment for employees or interns will not be tolerated, and it also tells what disciplinary action could be taken if any employee is found involved in any kind of such activity.
  • Confidentiality and Data Protection Policy: This policy helps the employee, customers, stakeholders, and other interested parties understand that the data, information, and documents they provide will be kept or used with the utmost care and confidentiality. With this policy, it is ensured that the organization gathers, stores, and handles data fairly, transparently, and with respect for individual rights.
  • Asset Management Policy: This policy is a set of rules that are made to maintain the integrity and availability of the data environment, and it is a process of receiving, documenting, tagging, and disposing of equipment.
  • Password Policy: Passwords are important aspects of any organization because they help companies secure a lot of data and information about the company. Unauthorized access and exploitation of a company’s resources may result from a weak password. This policy also informs the employees that the password should be updated and changed at certain intervals to keep the information and system safe.
  • Software Usage Policy: This policy helps the employees understand what software or applications they can use on the company’s provided systems. Companies have different software usage policies, with the main goal of reducing the use of unauthorized software in order to protect data and critical information from scammers and hackers or any third-party malicious software or applications.
  • Internet Usage Policy: This policy defines the correct way of using the company network and internet within the company’s premises. This policy helps the employee understand that if they use any other internet services for the company’s work, it might lead to emails containing malware, spyware, phishing, and unwanted (SPAM) content. This policy informs employees whether they can or cannot use the company’s network for personal work or personal devices, as connecting personal devices to the company’s network might lead to a loss of company information, and scammers are always waiting for these chances. This policy covers e-mail, the Internet, instant messaging, and other resources that are meant for company usage to protect company data and information, and the consequences are also clearly mentioned in case any employee is found involved in such activities or breaching the policy.

Benefits of Employee Handbook

The benefits of the Employee Handbook are as follows:

  • If a company has a handbook, it helps employees know about the company’s mission and sets a clear expectation in the employee’s minds about how they have to deal with the situation and what the company is expecting from them.
  • This is considered one of the quickest and most cost-effective ways to share company information with new employees, and the employee handbook is one of the best opportunities for managers to communicate the mission and values of the organization with the employees.
  • The employee handbook helps companies protect themselves from wrongful claims like lawsuits, harassment claims, termination claims, and discrimination. The Employee Handbook tells the employees about the company’s policies and expectations, and the employees also know how the management will address their queries and complaints.
  • The Employee Handbook is useful when you need to end an association with an employee who is underperforming or not meeting company standards.
  • Employee handbooks reduce the chances of conflict between the employer and the employees, as the employees are already aware of the company’s policies and the consequences they might have to face in the event of any wrongdoing.
  • When companies hand over their handbooks to new employees, they tell them about the company’s mission, purpose, and core values, which helps to build a positive work environment and develop trust between the employee and the employer. 

By using these policies, any new company can prepare their employee handbook. Some of the key policies that every employer should mention in their handbook are harassment, discrimination, discipline, compensation, leave, and a privacy policy. Once the employee handbook is prepared, it should be reviewed, and then all the company employees should be informed about the changes that are made in the employee handbook. The new employees should also be informed and notified about the company policies at the time of joining and post joining, and the handbook file should be shared with them once they get onboard in the company.

Last Updated : 29 Mar, 2023
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